This website uses cookies to ensure you have the best experience. Learn more

United States Government Debt Essay

1353 words - 6 pages

Government Debt
The history shows that the United States, from its beginning 1790 to present, has been free of a national debt only 2 years, 1834 and 1835.the government debt has grown from 75.5 millions in 1790 to 13.5 trillion 2010. The government debt growth is extremely alarming due to its rapid and huge growth over a year. The US national debt clock shows that the national debt growth rate is about $50000/1seconds. Every day we watch news or we read news about government debt, the news reporter, politics, and economist talk how bad the national debt hurt the economic and how it fact the people, however; for a better understanding of government debt and the significance of those ...view middle of the document...

Since the deficits are financed by government borrowing, national debt is equal to all government debt outstanding.
Understanding the definition of national debt is the first step to comprehend what going on the government debt and how it impacts the nation and the world as whole, now we need to understand how the debt is created or how it originates. First, government creates budgets to determine how much it needs to spend to run a nation. Oftentimes, however, a government may run a budget deficit by spending more money than it receives in revenues from taxes (including customs duties and stamps). In order to finance the deficit, governments may seek to raise money by taking on debt, that is, by borrowing it from the public. National debt depends on the nation’s annual budget. When the government spends more than the money the government raise, the deficit creates more debt. Today, US national Debt is over $14trillion, it is the highest national debt compering to the rest of the world. So, how is the notational debt affecting the people of United States example their social security and the military?.
How social security impact the government debts? Before answer that question one need to know what is social security and how it works. According to Investorwords website social security is defined as the comprehensive federal program of benefits providing workers and their dependents with retirement income, disability income, and other payments. The social security tax is used to pay for the program. Social security tax payment vary for each individual, the payment depend if you work for someone or self-employed and also how much you earn. The Social Security taxes that workers pay into the system are used to pay for Social Security benefits. Normal employees pay tax 6.2% of wage or salary and employers pay 6.2% ant 1.45 for the Medicare. Every month the payroll tax paid by employer and employee goes to social security trust fund. That money is being used to pay monetary benefits for disable and elder retired people. There is a big controversy on how the social security impact the National debt, some Politicians and economist argue that the pay roll tax paid by people is not enough to cover the benefits; however that lead to increment on national debt. Therefore, the government must find way to solve it, some politicians suggested that the tax rate should be increase, retirement benefit should be reduced and retirement age should be increase to 70. On the other hand, some economists and politicians believe that there is no problem on social security, the pay roll tax paid by workers is just enough to cover the social security benefits, as matter of fact it should have surplus, because there is always more people paying tax than people getting tax benefit. If there is debt on social security is because that the government uses the social security fund to pay other expense such; medicare, unemployment and welfare, defense, healthcare and so....

Other Essays Like United States Government Debt

Reduce Budget Deficit Essay

726 words - 3 pages tax revenues and government expenditures. The revenues from the budget surplus are typically used to reduce any existing national debt. In the case where government expenditures are exactly equal to tax revenues in a given year, the government is running a balanced budget for that year. Every year from 1970 through 1997 the United States government worked with a budget deficit. In 1998 the government finally recorded a surplus budget and the

Euro Crisis Essay

2961 words - 12 pages money in foreign markets will not be able to find any lender in international markets. As the world financial system is nowadays fully connected – meaning a problem for Greece, or another smaller European country, is a problem for U.S., too. The European debt crisis not only affects the U.S. financial markets, but also the U.S. government budget. Forty percent of the International Monetary Fund’s (IMF) capital comes from the United States, so if

A Critical Examination of the View That the Debt Crisis Is a Result of Inappropriate Development Policies

2672 words - 11 pages international financial system, a number of governmental and intergovernmental agencies, led by the United States, stepped in to assure the continued repayment of the Mexican loans. The world’s developing economies and their debt posed a huge quandary to economists and politicians from 1973 to 2000, and continue to do so even up until today. To conclude, this was partly the result of inappropriate development polices and mismanagement of loans by debtor

Reasons for the Annexation of Texas

2768 words - 12 pages , manifest destiny, politics , and constitutional rights. Also the way Texas began in a way said that they should be apart of the United States In the end there were more important reasons for annex Texas into the union, than to leave Texas the was she was. From the early days of pioneers and settlers, thousands of Americans began to move into what would become Texas. The Mexican government was wanting to populate the Texas area to

Deficit Financing Theory and Practice in Bangladesh

5519 words - 23 pages associated with the neoclassical-inclined Chicago school of economics, and has significant political and institutional support, with all but one state of the United States (Vermont is the exception) having a balanced budget amendment to its state constitution, and the Stability and Growth Pact of the European Monetary Union punishing government deficits of 3% of GDP or greater. Proponents of sound finance date back to Adam Smith, founder of modern

Government Shutdown

944 words - 4 pages enacted into law as expected by the Congress and the President (Brass p. 2). As such, it is apparent that a government shutdown has a number of implications on the overall economy of the country and federal government employees who form an important part of U.S. economy. In addition, the government shutdown can delay important activities and government processes hence undermining economic development (Fuscaldo). Recently, the United States has

His-135 Week 7 Interview Assingment

963 words - 4 pages Security revenue paid for by me and other Americans to replace lost revenue from this administrations tax cuts that assisted the rich. Therefore, I suffered as a result of this policy. Do you believe that Reagan raised the debt in the Country? Yes, prior to Reagan it took the United States 200 years to accumulate its first $1 trillion dollars of national debt, but once Reagan took office the second on trillion dollars of debt was accumulated in

Marriott Corporation

4191 words - 17 pages the leading lodging and food service companies in the United States. Marriott's 1987 profits were $223 million on sales of $6.5 billion. See Exhibit 1 for a summary of Marriott's financial history. Marriott had three major lines of business: lodging, contract services, and restaurants. Exhibit 2 summarizes its line-of-business data. Lodging operations included 361 hotels, with more than 100,000 rooms in total. Hotels ranged from the full-service

Emersion Electric Company Case

539 words - 3 pages payment and principle) about 103.5 million CHF, amounting to 108 million CHF in total. In New Zealand and United states, the total cost in their own respective currencies is estimated to be around 163.97 million NZ$ and 76.25 million USD respectively. To make a fair comparison, the costs of the bonds must be converted to a comparable unit of currency. In USD terms, bonds issued in Switzerland would cost $76.48 million and in New Zealand about $76.58

Mexico Us Comparison

1876 words - 8 pages )  11.016 (2008) | Fiscal year | 1 October - 30 September | calendar year | Public debt | 71.8% of GDP (2013 est.)  70% of GDP (2012 est.)  note: data cover only what the United States Treasury denotes as "Debt Held by the Public," which includes all debt instruments issued by the Treasury that are owned by non-US Government entities; the data include Treasury debt held by foreign entities; the data exclude debt issued by individual US

Credit Card Debit for College Students

1185 words - 5 pages graduate college. Credit card debt is a very widespread problem in the United States. The West has the greatest percentage of students with cards at ninety-one, while the Northeast has the fewest with only seventy-nine percent (Sallie “How”). Even though the Northeast has the lowest averages they still have outrageous percentages of card ownerships and debt, and these numbers only increase from year to year. With these percentages so high it is

Related Papers

United States History And Government Essay

688 words - 3 pages Although Christopher Columbus was not the first explorer to reach the Americas, his voyages led to the first lasting European contact with the Americans, inaugurating a period of European exploration, conquest, and colonization that lasted for several centuries. The European colonization of the New World have had a major impact on the historical development of Native Americans, Africans, and Europeans. The actions shown by Columbus’s discovery of

The National Debt Essay

554 words - 3 pages trillion dollars. Right after the Civil War the debt held at three billion dollars. In 1900, this debt of three million dollars had decreased to one million dollars. In 1919, at the end of the World War 1, the debt skyrocketed to 25.5 billion. When the Wall Street fell apart in 1929, the United States fell into something that was called the Great Depression. It started in 1930 and lasted until 1940. During this depression, President Franklin Roosevelt

Economic Policy Essay

1239 words - 5 pages country. There is a big difference between national debt and deficit. When the government spends money throughout the year on programs and other services exceeds the revenue the government earns in that year it is called a deficit (Amadeo, 2011). Each year the deficit is added to the national debts, which are all the combined deficits since the beginning of the country. The national debt of the United States has grown significantly since our

John Randolph's Influence On American Politics

1096 words - 5 pages . The unemployment rate in The United States is at an all time high. Jobs are being outsourced overseas to countries such as China. With the nation in an exorbitant debt, and the central government looking to monopolize medical care, “Policymakers are taking a fresh look at a money making idea long considered to be politically taboo: a national sales tax” (Montgomery). John Randolph would probably roll over in his grave if were to catch wind of